Union takes immediate pay cut

ROYAL OAK -- The union is small, but city officials said the concessions are symbolically significant as the municipal department heads and deputy administrators agreed to an immediate pay cut, unpaid holidays and increased contributions for pensions and health care.

The City Commission and its Department Head/Deputy Department Head Association ratified a new contract that will save Royal Oak money as elected officials struggle with another budget shortfall.

"The significant thing with this group is they didn't have to do it. They had a contract in place through June 30," City Manager Donald Johnson said.

Financial projections show the city using up all but $1.6 million of its savings reserve to balance the $32.5 million general fund budget for the upcoming 2011-12 fiscal year. To date, Royal Oak has won concessions from all of its unions except for the police and firefighters, whose contracts also expire June 30.

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The members of the latest unit to accept givebacks include Royal Oak's assistant fire chief, building official, engineer, planning director, controller, library director, information service director, budget analyst, deputy clerk and deputy treasurer. The deputy police chief currently is an interim position.

Members of the association agreed to accept an immediate 2.5 percent reduction in pay, 10 percent contribution toward health care premiums, 4 percent increase in pension contribution, and six unpaid holidays for the fiscal year starting July 1.

Johnson figures the health care contributions will amount to about a 3 percent reduction in compensation for each employee depending on what plan they have. The members didn't pay anything toward health care under former contracts.

Prior to reaching the agreement, the city had imposed 15 unpaid furlough days on each member. As a result of the agreement, furlough days scheduled for the remainder of this fiscal year are cancelled.

"I knew we could count on our department heads and deputies to step up and help the city during this difficult financial time," Mayor Jim Ellison said in a statement. "They are all very dedicated employees who do what it takes to get the job done, often resulting in considerable overtime that they give back to the city, without pay."

The other units to make concessions are the Service Employees International Union (Department of Public Service), Executive Department Head group, Professional-Technical Employee's Association and Local #2396 of Michigan AFSCME Council 25 members who have clerical, library and building department positions.